Where should India spend its money?
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India has achieved world-class quality in some sectors and yet has medium-level HDI, woefully inadequate infrastructure and poor delivery of public services. It is actually a good thing that rather than wait for all the gaps to be filled, India has been striving for higher levels of economic progress.

It is my thought that there are several rungs in the economic ladder and Centre should go hard at the next two levels. In my view, this is what PM Modi's govt is going to do in this term. There are also signs that enterprising States, corporates and businessmen can achieve high economic growth out of this foundation.

India is clearly moving out of absolute poverty, severe deprivation, and lack of basic social support. These are the lowest rungs of the economic ladder that will get completed after meeting the UN's sustainable goals. Many large states are still laggards in this respect and some of the 115 most deprived or "aspirational" districts are found in wealthy states like Maha, TN, Gujarat and Haryana. To help these places, Centre is sharing a higher proportion of its budget with States and it is sending additional funds directly to local govt bodies or Gram Panchayats. Central schemes including Aadhaar, direct bank transfer and MNREGA are designed to reach the poorest in villages or slums, and the migrant workers.

If one looks at HDI, then it is a slow, secular trend of improvement that takes its own time. States shouldn't measure their efforts in any way based on what impact they have had on HDI. Likewise, Centre has to look beyond HDI for directing policy or setting economic goals. PM Modi's NDA I government of 2014-19 was seen as pushing very hard on infrastructure which is the next rung on the economic ladder.

Now, in the second term, it is taking on the next rung which is about achieving or delivering quality standards and outcomes, through effective policy implementation and human capital deployment. It is a vast area covering economic reforms, governance and behavioural change, skills development, assured quality outcomes and economic efficiency. With this, it will be easier to deliver on the Commerce minister Piyush Goyal's call for higher quality standards for the industry. High product standards will open up India to world markets and reduce the scope for cheap, inferior reject-quality imports from China.

This will enable highly enterprising businesses and corporates to go one rung higher for innovation, world-class production and exports. And finally, some Indian corporates will become fast-growing giants that will be highly attractive for investors and bring large amounts of low-cost capital. Already, Centre has lowered corporate taxes to encourage new manufacturing in India and some enterprising states govts have slashed labour laws to bring in foreign direct investment. The stage is set for India to go ahead despite having patches of poor development.

Infrastructure, high efficiency, low cost of factors of production, assured outcomes of public services, and high quality of production all comprise two of the most essential rungs and are also the most difficult tasks to complete.